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USD: A mixed bag for the greenback ahead of Fed Chair Powell’s speech (1800BST). Having broken below the 96.00 handle the greenback has found support ahead of the March 2019 lows at 95.57. However, despite pulling back from its intra-day lows, the undertone for the USD remains soft with a dovish Fed Chair likely to keep the greenback pressured.

JPY: The Japanese Yen has approached flash crash levels having made a brief break through the 107.00 handle to the downside as risk appetite remains subdued, particularly with tensions between the US and Iran continuing to escalate. Risks remain tilted to the downside as the economic outlook continues to soften.

NZD: The New Zealand Dollar is outperforming in the G10 space following the latest trade balance data. However, caution should be taken with the rise in the Kiwi given the RBNZ rate decision overnight. While no change is expected in the cash rate (money markets attach 72% chance of no change), risks are tilted for the RBNZ to offer a dovish bias, much like the majority of global central banks. As it stands, markets call for a 80% likelihood that interest rates will be cut at the August meeting.

Gold: The precious metal remains buoyed by the rising tensions in the Middle East, which has prices at new cycle highs of $1435. However, there is a risk of a pullback, particularly if the G20 summit sees a reduction in trade war tensions. On the technical front, the daily RSI is the most overbought in 30yrs, while on the weekly timeframe, golds prices are the most overbought since August 2011. (full analysis)

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